Treasurer Joe Hockey has ruled against the sale of GrainCorp, Australia’s largest publicly-listed agribusiness, to US giant Archer Daniels Midland.

According to the Australian, Hockey said the $3.4 billion takeover was not in the nation’s best interest, but he would allow ADM to increase its holding from 19.85 percent to up to 24.9 percent, upon further applications.

He said GrainCorp’s network of more than 280 grain storage facilities and seven out of 10 grain port terminals in the eastern states makes it a significant market player.

“Given that the transition towards more robust competition continues and a more competitive network is still emerging, I consider that now is not the right time for a 100 per cent foreign acquisition of this key Australian business,” he said.

Hockey added that the public’s and stakeholder’s concern over the sale had influenced his decision. “A further significant consideration was that this proposal has attracted a high level of concern from stakeholders and the broader community.

“I therefore judged that allowing it to proceed could risk undermining public support for the foreign investment regime and ongoing foreign investment more generally.”

Australia is, however, still open for business, he said, and Australia must continue to attract foreign investment.

“Of the 131 significant foreign investment applications we have dealt with, this is the only application we [Foreign Investment Review Board] have prohibited.

“The fact is we need foreign investment, we welcome foreign investment. But it has to be foreign investment that is not contrary to the national interest.”

“We are disappointed by this decision. We are confident that our acquisition of GrainCorp would have created value for shareholders of ADM and GrainCorp, as well as grain growers and the Australian economy,” said ADM chairman and CEO Patricia Woertz.

“Throughout this process, we worked constructively to create an arrangement that would be in Australia’s best interests and made substantial commitments to address issues that were important to stakeholders."

In regards to ADM’s current investment in GrainCorp, Woertz said, “As owner of 19.85 percent of GrainCorp, we will look to work with them to maximise returns on our investment and create value for both companies.”